As OnLive and Gaikai are proving, cloud gaming -- that
is, streaming gameplay from an external source rather than relying on
local processing power -- is a reality. OnLive is already in the hands
of consumers, GameStop's upcoming service has been demonstrated in
public venues, and Gaikai is striking up some impressive partnerships with companies such as Walmart and Electronic Arts.

"Cloud gaming is the future,"
Crytek CEO Cevat Yerli recently told us, and he's not alone in these
sentiments. But so far, the reality of cloud gaming has been in
expensive dedicated datacenters, which may not be a viable solution if
cloud gaming is to become something as prevalent as "the future."

The organizers of the upcoming Cloud Gaming USA 2011
expo got a number of industry experts to weigh in on the subject,
asking if datacenters were completely necessary for cloud gaming or if
games could be optimized for easier streaming at the development stage.

"It's our responsibility as publishers to look at the latency issue from
all sides," said THQ's Brian Farrell, who admits that game makers can
make games that are specifically tailored to streaming.

"Whether that means reducing the video resolution or coding specifically
for an online game logic or adding more server locations, the potential
solutions vary widely," he explained.

David Perry of Gaikai, which differentiates itself from OnLive by
operating 24 datacenters as opposed to the latter's 3, stresses that
they are the only solution.

"This is never going to be easy," he said. "Anybody that wants to stand
up a real cloud network for gaming has to cover the world at a
critically close proximity to the users."

A massive amount of datacenters is the only way to make cloud gaming a
reality, says Perry, because "you're dealing with physics" and the
limitations of the speed of light. OnLive CEO Steve Perlman recently told Gamasutra that the need for numerous datacenters was a "misconception."

Major game retailer GameStop recently purchased
streaming technology company Spawn Labs, which has been working on an
OnLive-like consumer-facing streaming service since last year.

According to GameStop's Tony Bartel, datacenters are a necessity, and
the company thinks that it will solve latency with a large amount of
them.

"We believe that our technology will get latency to a point where it's
imperceptible even to a very discerning gamer," he said. "We're going to
continue to drive that down, as I'm sure OnLive and Gaikai are."

Bartel, Perry and Farrell will all speak at the Cloud Gaming USA
conference in September. The report that these interviews were published
in is available for free at the conference website.